The Hindu Business Line : Bear run arrested

BULL pressure on Monday curtailed the two-day bear run. However, sentiment reading of the tradable counters remains strongly bearish. Further bull domination on Tuesday is likely to change the sentiment reading to bullish.

Nifty futures recommendation: During the initial hour of day's trading the near month May contract lost around 14 points from the opening price. Bears were unable to sustain their momentum and succumbed to bull pressure. The May contract had intra-day range of 33 points. It closed higher with a gain of around 25 points over Friday's close.

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The short position in the May contract remains intact. The exit and the bullish trigger level for the May contract are placed at the same level. Bull domination on Tuesday has the potential to trigger the uptrend in the May contract.

Stock futures recommendation: The composition and the ranking of the top-10 tradable list had few changes. Arvind Mills and Tata Motors gained entry with the exit of ICICI Bank and Wipro. State Bank moved to the top slot followed by Reliance Industries and Tata Steel. The exit level for the downtrend in ICICI Bank and ONGC are placed at 360.05 and 828.05 respectively.

Except for the downtrend in Polaris and Union Bank, all the other counters in the list are likely to be under threat. Bulls are likely to have opportunity in four counters. On the other hand, lone selling opportunity is likely to exist in Infosys. The best bet for Tuesday's trading is likely to be the buying in Tata Steel. This counter is in downtrend. Bull move on Tuesday has the potential to reverse the prevailing downtrend in Tata Steel.

Cash segment: There were no new entries or exits to the active counters list. The ranking of the list remains unchanged. Bull move on Tuesday is likely to terminate most of the downtrend counters in the list. On the contrary, uptrend in Infosys is likely to be under threat.

Buying opportunities are likely to exist in six counters. Selling opportunities are likely to exist in two counters.

Buying in Tata Steel is likely to be the best for Tuesday's trading. This counter is in the downtrend. Exit and buy levels for this counter is placed within Rs 2 from the closing price.

Bull pressure on Tuesday is likely to trigger the uptrend in Tata Steel.

(Note: All price levels refer to the absolute value of the shares traded on the NSE. There is risk of loss in trading.)

The author is a technical analyst and fund management consultant.

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